Rupee slides to two-year low as yuan devaluation weighs

Weakens to as much as 64.95 on dollar demand from banks, importers

The rupee tumbled to a near two-year low of 64.95 on sustained dollar demand from banks and importers following yuan devaluation.

The rupee resumed lower at 64.55 per dollar as against yesterday's closing level of 64.19 at the Interbank Foreign Exchange (Forex) market and dropped further to a near two-year low of 64.95 at one point. 

The Reserve Bank of India sold dollars through state-owned banks to stem the fall, traders said.

China's surprise decision to devalue the yuan sparked a sell-off in global currencies. Emerging market currencies from Indonesia to Brazil reeled as investors feared central banks could rush to weaken their own currencies in response to China's move. 

Yuan hit a four-year low today, falling for a second day after authorities devalued it in a move that sparked fears of a global currency war and accusations that Beijing was unfairly supporting its struggling exporters.

Oil prices also extended losses in Asia today as Chinese economic worries and oversupply concerns added to the downward pressure, analysts said.